In a significant judgment, the Punjab and Haryana High Court has ruled that the accumulated unutilised leave of an employee cannot be reduced to 300 days even if he is entitled to leave encashment for a maximum of 300 days.
The ruling came in case of Haryana Government employees after the High Court was told that accumulated earned leave was reduced to 300 days time and again during the course of service on the assumption that they were entitled to a maximum of 300 days earned leave.
Eventually, when the time came for encashment of unutilised earned leave, they were granted the benefit for lesser number of days.
“If an employee is entitled to leave encashment for a maximum limit of 300 days, that does not mean that the accumulated unutilised leave is to be reduced to 300 days if it exceeds the limit. The earned leave will continue to accumulate till the retirement of the petitioners and the petitioners are to be granted the maximum benefit of 300 days, as stated in the rules,” Justice Kuldip Singh ruled.
The ruling came on a petition by Jaipal Phogat and another petitioner against the State of Haryana and other respondents. Justice Kuldip Singh asserted the “unfortunate controversy” was regarding the method used to calculate unutilised earned leave of petitioners Jaipal Phogat and Jaibhagwan.
Retired mechanics, the petitioners had claimed that they were entitled to leave encashment of 300 days unutilised earned leave. Petitioner number one was is entitled to 300 days leave encashment, but was granted the benefit of 257 days. Petitioner number two, on the other hand, was entitled to 268 days leave encashment, but was granted the benefit of 211 days.
During the course of the hearing, Justice Kuldip Singh asked both parties to file calculation sheets. He added that the examination of calculation sheet regarding Phogat showed mischief was done while calculating unutilised earned leave on April 27, 1999, May 22, 2003, and October 31, 2007.
The unutilised earned leave for 362 days, 375 days and 335 days, respectively, was reduced to 300 days on the assumption that the petitioner was entitled to a maximum of 300 days earned leave.
Similarly, in Jaibhagwan’s case, earned leave was reduced on August 11, 2002, May 22, 2003, and August 22, 2003, from 308 days, 307 days and 305 days, respectively.
“The calculation done by the respondents is not only mischievous, but wrong application of the principle of calculation of unutilised earned leave is also there. As such, the calculations made by the petitioners are accepted and that of the respondents are set aside,” the High Court ruled. 7th January 2017 From India, Malappuram
Is this applicable to PAN India, I have seen a lot of MNC, Indian companies have capping of earned leaves carry forward limited to 60 or so, any idea is this right? 9th January 2017 From United States, undefined
The standing orders and factory act / shop & establishment act provides a cap which the company may follow. In that case, there is nothing wrong in stating that all the leaves need to be utitlised or will lapse.
In the above case, there was no such restriction on carry forward but only on the encashment. 9th January 2017 From India, Mumbai
VARIOUS LABOUR RULES/ACTS ARE NOT CLEAR AND NOT KNOWN AND PRACTICED BY THE PVT. COMPANIES. ONLY THROUGH COURT CASES, WE HAVE BEEN HIGHLIGHTED BUT DUE TO LACK OF KNOWLEDGE IN LABOUR LAWS, MANY OF THE PVT. CO. ARE REFUSING AND RESTRICTING TO THEIR CHOICE. DUE TO JOB FEAR AND FOR FUTURE, MANY OF WORKERS NOT CLAIMING THEIR BASIC RIGHTS PROVIDED IN THE LAW. IN GENERAL, COMPANY CAN'T RESTRICT THE EARNED LEAVE AS IT THE RIGHT OF THE EMPLOYEE TO ADJUST AGAINST THEIR LEAVE OR TO GET BACK THEIR HARD EARNED MONEY BY SURRENDERING (leave encashment). 28th November 2017 From India
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